Client Newsflash

Outsourcing Licenses to Be Processed by BKPM; Only Granted for Single Line of Business

On January 26, 2015, the Minister of Manpower issued Reg. No. 6 of 2015 on Standard Operational Procedure for Outsourcing Business License Issuance through the One-Stop Integrated Services in the Investment Coordinating Board (“MOM Reg. 6/2015”), which delegates to BKPM (the Investment Coordinating Board) the authority to issue outsourcing licenses to PMA (foreign capital investment) companies and companies with cross-provincial scope.

MOM Reg. 6/2015 stipulates Standard Operational Procedures for the issuance of new outsourcing business licenses, as well as procedures on extension, amendment, filling and reporting by companies.

Under the regulation, outsourcing licenses may only be granted for one type of outsourcing, i.e., cleaning services, catering, security, oil & gas and mining services, or transportation.

Outsourcing licenses are now supposed to be granted within one business day after the required documentation is verified and certified complete by BKPM. Once issued, the license is valid for 3 years and may be extended.

Although BKPM issues the licenses, the Manpower Service Office remains responsible for inspection and compliance, and thus, has authority to issue recommendations to BKPM to revoke the licenses of companies that fail to comply with their licenses or other requirements under prevailing labor laws.

This delegation is aimed at streamlining the licensing procedures for PMA companies in the outsourcing business.

 May 13, 2015

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